Post-pandemic, the global aviation market's resurgence is poised to propel Taiwan's aerospace industry output to a four-year pinnacle. With governmental policies sustaining domestic aircraft production, industry insiders underscore the imperative of elevating Taiwan's aerospace self-sufficiency and constructing an adaptable supply chain for both military and civilian applications.
The Aerospace Industrial Development Corporation (AIDC), a stalwart in Taiwan's military aircraft development, is advocating the indigenization of components for soon-to-be-retired trainer aircraft. Emphasizing the necessity for the aerospace sector to command pivotal technologies, AIDC seeks to emancipate Taiwan from foreign dependencies.
In the realm of technological autonomy, exemplified by the T-BE5A Brave Eagle, where 55% of components are domestically sourced involving over 200 local firms, the trajectory suggests that with early preparations for the new jet trainer, AIDC envisions elevating Taiwan's self-sufficiency rate to a minimum of 65%.
Although achieving the production of aerospace components domestically is commendable, experts in the industry suggest that the global aerospace sector, evolving over a century, has established a somewhat resistant system. This system is marked by lengthy processes for certifying aerospace products. Nevertheless, once these associations are firmly established, they tend to endure. While international orders may require the use of approved raw material suppliers, the partnerships are not set in stone.
Amidst the current geopolitical tensions, disruptions in the manufacturing supply chain are creating opportunities for realigning supply chains. AIDC revealed during an earnings call that, in the midst of the material shortage in 2023, system suppliers agreed to AIDC's simultaneous research and development of specific components, approved by original equipment manufacturers. Looking ahead to future autonomy, AIDC aims to independently produce components to address shortages.
AIDC emphasizes its dedication to scrutinizing local raw material suppliers and recommending them to customers, aiming to expedite delivery timelines and enhance national defense autonomy.
Taking advantage of the post-pandemic economic recovery, despite the Red Sea crisis, the aerospace industry foresees favorable prospects. The shift in transport mode is driving up air freight costs.
Operational prowess defined the aerospace industry's 2023 performance, with robust order books for Taiwanese entities like AIDC, AirAsia, Eva Air, and Drewloong Precision, among others. Leading Taiwanese aircraft manufacturers are navigating a post-pandemic demand surge, with an urgent need for components. System suppliers are actively sourcing suitable providers.
According to the Committee for Aviation and Space Industry Development (CASID) within the Ministry of Economic Affairs (MOEA), the latest figures reveal a 10.64% year-on-year upswing in Taiwan's aviation industry's total output in 2022. This underscores the recovery of the domestic aviation industry. Optimistic about the future, aerospace industry stakeholders are confident that Taiwan's aviation industry's total output in 2023 will surpass the preceding year, reaching a nearly four-year zenith.
